AI-Powered eCommerce: 21 ways to use artificial intelligence in e-commerce

What is AI-powered eCommerce?

AI-powered eCommerce uses NLP, ML, CV, and data mining technologies to improve various aspects of eCommerce, from customer interactions to business processes—for example, Chatbots, AI-eCommerce website builders, and marketing funnel automation services. Artificial intelligence can help online businesses gather and analyze customer data, automate tasks and procedures, and make better business decisions.

Here are the four main types of AI technologies used in e-commerce:

1. Natural Language Processing (NLP): NLP is one branch of AI that focuses on interpreting and generating human language. In e-commerce, NLP analyzes customer reviews, product descriptions, and queries to understand sentiment, extract relevant information, and provide accurate responses.
2. Machine Learning (ML): ML enables computers to learn and make predictions without being explicitly programmed. In e-commerce, ML algorithms analyze customer behavior, browsing history, and purchase patterns to provide personalized product recommendations and optimize pricing strategies.
3. Computer Vision (CV): CV involves interpreting and understanding visual information from images and videos. In e-commerce, CV is used for tasks like visual search, where customers can upload images to find similar products, and product categorization, where photos are automatically tagged and classified.
4. Data Mining: Data mining is the discovery of patterns and insights from large datasets. In e-commerce, data mining techniques are used to gather and analyze customer data, such as browsing history and purchase patterns, to inform AI algorithms and improve the overall customer experience.

Artificial intelligence (AI) has become part of our daily lives in recent years, revolutionizing various industries and transforming how we live and work. One area where AI has made a significant impact is e-commerce.

21 Proven Ways to Use Artificial Intelligence in E-commerce

Artificial intelligence (AI) has revolutionized various industries, and e-commerce is no exception. AI can transform how companies operate and interact with customers, leading to improved customer experiences, increased sales, and enhanced efficiency.

This section will explore 22 proven ways to use artificial intelligence in e-commerce and the benefits they bring. You will also find examples of SaaS companies offering AI-based services.

1. Chatbots & Virtual Assistants

Chatbots and virtual assistants are extremely popular in the e-commerce industry. These AI-powered tools can provide instant support, answer frequently asked questions, and assist with product recommendations.

You can automate customer interactions using chatbots and virtual assistants to time and resources while delivering a seamless shopping experience. Tools like Drift and Intercom provide AI-powered chatbots that can enhance customer service and improve customer interactions.

Here are two examples of popular AI virtual assistants:

• Apple Siri: Siri is a well-known virtual assistant developed by Apple that uses AI technology to understand natural language voice commands and perform tasks for the user. It can provide information, set reminders, send messages, make phone calls, and perform various other functions on Apple devices.
• Amazon Alexa: Alexa is an AI-powered virtual assistant developed by Amazon. It can respond to voice commands, play music, provide weather updates, control smart home devices, answer questions, and perform various tasks through voice interactions.

These examples demonstrate how AI virtual assistants utilize natural language processing and AI algorithms to understand and respond to user queries. They provide automated assistance and perform tasks to enhance user experience and productivity.

2. Recommendation & Personalization Engines

Powered by AI, personalization engines offer tailored content and recommendations based on individual preferences, enhancing customer experiences and boosting conversions. They’re valuable in email marketing, product suggestions, and website customization.

Recommendation engines, on the other hand, focus on analyzing customer data to suggest relevant products, elevating customer engagement and sales.

Companies like Amazon and Netflix have successfully implemented recommendation engines, resulting in higher conversion rates and customer satisfaction.

Software like Dynamic Yield and Algolia offer recommendation engines that can provide personalized product suggestions based on customer behavior and browsing history.

3. Visual Recognition Tools

Visual recognition tools use AI algorithms to analyze images and videos. In e-commerce, these tools can be used for visual search, allowing clients to find products by uploading pictures.

Visual recognition tools also enable augmented reality (AR) and virtual reality (VR) experiences, allowing customers to try products virtually before purchasing.

Clarifai and ViSenze enable image-based product searches, allowing customers to find similar sites by uploading images.

4. Predictive Analytics

Predictive analytics relies on historical data and machine learning algorithms to forecast behaviors and trends. In e-commerce, predictive analytics can predict customer preferences, optimize inventory management, and personalize marketing campaigns.

By leveraging predictive analytics, businesses can make data-driven decisions and stay ahead of the competition. Here are three examples of SaaS companies using predictive analytics in eCommerce:

• Itransition: Itransition offers predictive analytics consulting services for eCommerce companies to optimize operations, increase customer loyalty, and boost profits. Their predictive analytics tools help forecast market demands, predict customer behavior, enable dynamic pricing, and detect fraud.
• Octoparse: Octoparse is an eCommerce SaaS company that provides a data scraping and analytics platform. The platform offers ready-to-use templates for scraping product information from eCommerce websites like Amazon, eBay, Alibaba, Walmart, and Target.
• Varyence: Varyence offers a SaaS eCommerce data analytics platform with a single dashboard for assessing eCommerce product lines and overall business performance. The platform leverages predictive analytics to help businesses make data-driven decisions to optimize operations.

These companies utilize predictive analytics in their SaaS solutions to help online entrepreneurs gain insights, optimize operations, and drive growth.

5. Pricing Optimization Tools

Pricing optimization tools use AI algorithms to determine the optimal product price based on market demand, competitor prices, and customer behavior. These tools help to maximize profit margins, increase sales, and maintain a competitive edge.

By dynamically adjusting prices in real time, businesses can respond to market changes and optimize revenue. Platforms like Pricemoov and Competera offer dynamic pricing strategies that set up pricing based on real-time user behavior and global demand.

6. Customer Behavior Analytics

Customer behavior analytics involves analyzing customer data to gain insights into their preferences, purchasing patterns, and engagement levels. By understanding customer behavior, businesses can tailor their marketing strategies, optimize product offerings, and improve customer retention.

AI-powered customer behavior analytics tools provide actionable insights and help businesses make data-driven decisions. For example, Crayon and Metrilo offer AI-powered solutions to understanding customer behavior and gaining valuable insights.

7. Voice Search Optimization

Voice search optimization involves optimizing website content and product listings to be compatible with voice-enabled devices like smart speakers and virtual assistants. With the rise of voice search, businesses must ensure their content is voice-friendly to reach a wider audience.

Companies can improve their search rankings by optimizing for voice search and attracting more customers. Here are three examples of companies providing Voice Search Optimization services:

• Semrush: Semrush offers voice search optimization services to help businesses optimize their listings for virtual assistants like Siri and Google Assistant. Their services include listing management, voice search analytics, and optimization for local search results.
• VoiceSEO: VoiceSEO is a voice search optimization agency that provides services to help brands optimize their websites and content for voice search. Their services include Google Assistant SEO, Siri SEO, Alexa SEO, and voice marketing services tailored to the needs of each client.
• Teknicks: Teknicks is a voice search optimization agency that provides voice marketing services to help businesses optimize their content for voice search. Their services include voice search optimization, analytics, and smart voice devices to improve marketing strategies.

These companies offer various voice search optimization services to help online sellers improve their online visibility and reach more customers.

8. Natural Language Processing (NLP) Tools

NLP tools enable machines to understand and interpret human language. In e-commerce, NLP tools can be used for sentiment analysis, chatbots, and voice assistants. By analyzing customer feedback and sentiment, businesses can gain valuable insights into customer satisfaction and make improvements accordingly.

NLP tools also enhance the conversational capabilities of chatbots and virtual assistants, providing a more natural and personalized experience for customers. Here are three examples of companies using NLP tools to offer services:

• MonkeyLearn: MonkeyLearn is a popular SaaS platform that offers natural language processing (NLP) tools and services. The platform provides pre-trained NLP models and APIs that allow businesses to analyze and extract insights from unstructured text data like emails, social media posts, online reviews, and more.
• OpenAI: OpenAI is a leading AI research organization that offers GPT-3, a powerful language model. Their SaaS offering allows developers to leverage NLP capabilities to build applications that generate human-like text, perform language translation, answer questions, and more.
• Lexalytics: Lexalytics is a SaaS company that specializes in text analytics and sentiment analysis. They provide NLP tools and services that help businesses extract meaning and sentiment from text data, enabling them to gain insights, monitor brand reputation, and make data-driven decisions.

These companies leverage NLP tools and AI technologies to offer SaaS solutions that enable businesses to analyze, understand, and extract valuable insights from text data.

9. Fraud Detection & Prevention

Fraud detection and prevention tools use AI algorithms to identify and prevent fraudulent activities in e-commerce. These tools analyze transaction data, customer behavior, and patterns to detect suspicious activities and prevent unauthorized access.

Fraud detection and prevention tools allow businesses to protect e-commerce operation and their customers. It minimizes financial losses and maintains trust. For example, Kount and Riskified provide AI-powered fraud detection solutions that can analyze data in real-time to detect and prevent fraudulent transactions.

10. Inventory Management & Forecasting

Inventory management and forecasting use AI algorithms to optimize inventory levels, predict demand, and prevent stockouts or overstocking. By accurately forecasting demand and optimizing inventory, businesses can reduce carrying costs, improve order fulfillment, and enhance customer satisfaction.

AI-powered inventory management tools automate and streamline these processes, saving time and resources. Here are three examples of companies offering services based on inventory management and forecasting:

• TradeGecko (now QuickBooks Commerce): TradeGecko is a cloud-based inventory management system allowing merchants to take control of their business operations from order through to fulfillment. It is designed for wholesale and e-commerce businesses with multiple users, warehouses, sales channels, currencies, and tax requirements.
• Brightpearl: Brightpearl is a cloud-based inventory and order management software for retail and wholesale businesses. The platform offers features like inventory management, order management, shipping and fulfillment, accounting and reporting, and more.

These companies enable optimized operations, reduced costs, and improved customer satisfaction.

11. AR & VR Tools

AR and VR tools enable immersive experiences in e-commerce. Augmented reality lets customers visualize products in their environment by overlaying virtual objects in the real world. Conversely, VR creates a fully immersive virtual experience, allowing customers to explore items in a virtual store.

Here are some of the top augmented and virtual reality software for small businesses and organizations:

These apps and software can enhance customer engagement, reduce purchase hesitation, and increase sales.

12. Marketing Automation & Retargeting

Marketing automation and retargeting involve using AI algorithms to automate marketing campaigns and target specific customer segments. Businesses can deliver personalized marketing messages at the right time and through the proper channels by analyzing customer data and behavior.

Here are a few examples of marketing tools using AI for email marketing, sales funnel creation, customer relationship management, and more:

GetResponse: GetResponse is a reliable all-in-one marketing platform that provides email marketing, landing pages, webinars, and marketing automation. It provides tools to create, launch, and manage online marketing campaigns, making it easier for businesses to engage with prospects and turn leads into customers.

AWeber: AWeber is a well-known email marketing platform that allows marketers to create and send professional-looking emails and newsletters. Its user-friendly interface offers features like autoresponders, segmenting, and analytics to help companies to grow their email list and engage with subscribers effectively.

ClickFunnels 2.0: ClickFunnels 2.0 is a sales funnel builder designed to help businesses create online sales funnels that convert visitors into leads or customers. It offers pre-built funnel templates, drag-and-drop editing, and integrations with various tools, making it easier to market, sell, and deliver their products online.

GoHighLevel: GoHighLevel is a comprehensive marketing platform tailored for agencies and marketers. It offers a suite of tools, including CRM, sales funnels, appointment scheduling, and automation, to help businesses manage leads, nurture relationships, and convert prospects into paying customers.

Marketing automation and retargeting increase customer engagement, improve conversion rates and drive repeat purchases.

13. Sentiment Analysis Tools

Sentiment analysis tools use AI algorithms to analyze customer feedback, reviews, and social media posts. By understanding customer sentiment, businesses can identify areas for improvement, address customer concerns, and enhance their products and services.

Sentiment analysis platforms also help businesses monitor brand reputation and respond to customer feedback promptly.

Here are three examples of Sentiment Analysis Tools:

Brandwatch: Brandwatch is one of the leading social media monitoring tool with sentiment analysis capabilities. It allows businesses to track brand mentions, analyze sentiment, and gain insights into customer opinions across various online platforms.

Lexalytics: Lexalytics is a text analytics company that provides sentiment analysis for various types of content, including social media, news, and reviews. Their Salience engine can extract sentiment, themes, entities, and more from unstructured text.

MonkeyLearn: MonkeyLearn is a machine-learning platform that allows users to build, train, and deploy models for text analysis. It offers pre-trained models for sentiment analysis, making it easier for businesses to analyze text data and determine the sentiment of customer feedback.

These tools help businesses understand customer sentiment, enabling them to make informed decisions and improve customer experiences.

14. Supply Chain Optimization

Supply chain optimization involves using AI algorithms to optimize goods flow, reduce costs, and enhance efficiency. You can make data-driven decisions and optimize supply chain operations by analyzing historical data, demand patterns, and external factors.

AI-powered supply chain optimization tools help to streamline processes, improve customer satisfaction, and reduce lead times. Here are three examples of Supply Chain Optimization tools powered by AI:

Llamasoft: Llamasoft provides an AI-driven supply chain analytics and insights platform. It offers tools for demand forecasting, inventory optimization, and transportation route planning. The platform helps businesses to make data-driven decisions, reduce costs, and improve supply chain efficiency.

ClearMetal: ClearMetal is an AI-powered end-to-end inventory optimization solution. It uses machine learning to provide demand forecasting, inventory allocation, and replenishment recommendations. The platform aims to reduce stockouts and excess inventory, improving supply chain performance.

o9 Solutions: o9 Solutions offers an AI-powered integrated business planning platform. It provides tools for demand, supply, and integrated business planning. The platform’s AI capabilities help in scenario planning, demand forecasting, and supply chain visibility, enabling businesses to optimize their supply chain operations.

These tools leverage AI to provide insights, predictions, and recommendations, helping businesses to optimize their supply chain processes and improve overall efficiency.

15. Social Media Monitoring & Analysis

Social media monitoring and analysis involve using AI algorithms to track social media conversations, mentions, and trends. Social media monitoring allows e-commerce to gain insights into customer preferences, sentiment, and brand perception.

Social media analysis helps businesses identify influencers, engage with customers, and respond to customer inquiries and feedback. Here are three examples of Social Media Monitoring & Analysis tools that utilize AI:

Hootsuite: Hootsuite is a versatile social media management platform that integrates AI capabilities to analyze social media content, track brand mentions, and measure sentiment. Its AI-driven insights help businesses understand their audience’s behavior and preferences, allowing for more effective engagement and content strategies.

Brand24: Brand24 is an excellent social media monitoring tool that uses AI to track mentions of specific keywords, brands, or topics across the internet. It provides sentiment analysis, influencer scoring, and real-time alerts, helping businesses to gauge public sentiment and respond promptly to emerging trends or issues.

Sprinklr: Sprinklr is what we call a unified customer experience management platform that incorporates AI for social media monitoring and analysis. It offers features like sentiment analysis, trend detection, and predictive analytics, enabling businesses to understand their audience better and optimize their social media strategies.

These tools leverage AI to provide deeper insights into social media data, helping businesses to monitor their online presence, understand audience sentiment, and make informed decisions.

16. AI Writing Assistant & Article Writer

AI writing assistants use natural language processing and machine learning to assist with content creation and optimization. These tools provide suggestions for improving readability, grammar, and SEO.

Thanks to AI writing assistants, brands can produce excellent content that resonates with their target audience and improves search engine rankings. Here are short descriptions for each AI Writing Assistant or Article Writer:

Koala Writer: It’s a user-friendly AI tool designed to enhance writing by offering suggestions, structure improvements, and content optimization.

WriteSonic: An advanced AI-powered writing assistant that generates high-quality content based on user prompts, including blog posts and ad copies.

ChatGPT: A generative language model by OpenAI, capable of crafting detailed responses, stories, and content based on user input.

Grammarly: An AI-driven writing assistant that corrects grammar, checks tone, and offers style suggestions to improve overall writing quality.

Each of these tools harnesses the power of AI to assist users in various writing tasks and enhance the quality of content.

17. AI Video Generator

AI video generators use ML algorithms to automate the creation of videos. These tools can convert text into video content, create product videos, and generate personalized messages.

With the help of AI video generators, companies can produce engaging video content at scale, increase customer engagement, and drive conversions. Here are three examples of AI Video Generators, along with short descriptions.

Magisto: An AI-powered video editor that automatically creates and edits videos based on user-selected styles, music, and content, simplifying the video production process.

Lumen5: It utilizes AI to transform blog posts and articles into engaging videos, offering customizable templates, media assets, and automated scene creation for easy video generation.

Promo: An AI-driven video creation platform that provides ready-made video templates, stock footage, and music tracks, enabling businesses to craft professional-quality videos effortlessly.

InVideo: An AI-assisted video creation tool that offers a vast library of templates, media elements, and editing tools, allowing users to produce captivating videos for various platforms and purposes.

These tools leverage AI to automate and enhance the creation process, making it easier to produce high-quality videos without extensive editing skills.

18. Image Creator

Image creators use AI algorithms to generate high-quality images based on user input or predefined templates. These apps and software let you make product images, social media graphics, and personalized visuals.

AI image creators help to save time and resources on graphic design. You can have visually appealing content and enhance your brand identity. Here are 4 examples of image generators using AI:

DeepArt: It uses deep neural networks to transform photos into artworks based on different artistic styles, creating unique and captivating art-inspired images.

RunwayML: An AI software platform that offers tools for artists and creators, enabling them to generate, modify, and experiment with images using advanced machine learning models.

DALL·E: Developed by OpenAI, DALL·E is a variant of the GPT-3 model designed to generate original images from textual descriptions, showcasing the potential of generative AI in visual arts.

MidJourney: An AI-powered platform that aids in the discovery and curation of visual content, leveraging machine learning to analyze, categorize, and recommend images based on user preferences and needs.

These AI-driven tools offer diverse capabilities, from generating new images to curating and enhancing existing visual content.

19. AI Website Builders

AI website builders utilize machine learning algorithms to automate the website creation process. These platforms can analyze user preferences, industry trends, and design principles to build visually appealing and user-friendly websites.

AI website builders help online entrepreneurs to save time and resources on website development. You can build professional-looking websites quickly without coding. Here are four examples of AI website builders:

AiDA (by Bookmark): An AI-driven website builder offering personalized design suggestions. AiDA learns user preferences and creates tailored websites in minutes without coding.

Hostinger Website Builder: Hostinger offers a user-friendly platform powered by AI, offering customizable templates and intuitive design tools to help people create professional-looking websites effortlessly.

Wix ADI (Artificial Design Intelligence): Wix’s AI solution crafts unique websites by asking users a series of questions and then automatically designing a site based on their answers.

Firedrop: An AI website designer named “Sacha” assists users in creating web pages. Users can design and customize their website layout and content by interacting with Sacha.

These AI website builders simplify the web design process, making it accessible for users without technical expertise to launch and manage their own websites.

20. AI-powered Workforce Management Software

AI-powered workforce management software uses AI algorithms to optimize workforce scheduling, task allocation, and performance management. These SaaS platforms can analyze historical data, employee skills, and business goals to improve workforce productivity and efficiency.

AI-powered workforce management software streamline operations, reduce labor costs, and improve employee satisfaction. Here are three examples of AI-powered Workforce Management Software:

Deputy: It’s an AI-driven workforce management tool that automates scheduling, timesheets, and communication, optimizing staff allocation based on demand and employee availability.

Kronos Workforce Ready: A comprehensive platform that uses AI to offer solutions for employee scheduling, time tracking, and HR management, ensuring optimal workforce deployment and productivity.

Pega Workforce Intelligence: Utilizes AI to capture workforce data, analyze employee productivity, and provide actionable insights to optimize operational efficiency and improve overall workforce performance.

These tools leverage AI to provide insights, automate tasks, and enhance decision-making, helping businesses manage their workforce more effectively and efficiently.

21. Data Mining

Data mining involves extracting valuable insights and patterns from large datasets using AI algorithms. In e-commerce, data mining can be used to analyze customer behavior, identify market trends, and optimize pricing strategies.

It allows data-driven decisions, improve customer targeting, and give a competitive edge in the market. Here are three examples of AI-powered data mining software:

RapidMiner: A leading data science platform that integrates AI for advanced analytics, enabling users to design predictive models and mine valuable insights from vast datasets.

IBM SPSS Modeler: An AI-enhanced predictive analytics software that offers data preprocessing, model building, and deployment capabilities, simplifying the data mining process for actionable insights.

KNIME: An open-source data analytics platform that incorporates AI algorithms for data mining, helping users discover patterns, anomalies, and relationships in large datasets.

These tools harness the power of AI to delve deep into data, extracting meaningful patterns and insights that can drive informed decision-making and business strategies.

In conclusion

Artificial intelligence offers numerous opportunities for businesses in the e-commerce industry. AI tools like chatbots, recommendation engines, predictive analytics, and visual recognition tools can enhance customer experiences, increase sales, and improve operational efficiency.

Embracing AI in e-commerce is crucial for future success and staying ahead in a rapidly evolving digital landscape.